LEDE ON
We’re nearing the end of summer (often defined as ending with Labor Day here in the US). Many of you have been vacationing in inflationville, and are getting ready to head back to work. So here’s the question: how many photos did you take?
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News
Kumamoto Back Online
The earthquake in Japan that shut down the Sony facility that makes image sensors, began a staged restart on August 4th, about a week after the 7.1 magnitude tremor hit nearby. Full production resumed on August 19th, and things moved much faster than what happened in 2016, when a previous quake shut down the same plant for three-and-a-half months. Meanwhile, the TSMC facility in nearby Kikuyo has also come back online, as has the Renesas plant in Nishiki.
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News and Commentary
Nikkei’s Total Camera Market Shares
Every year about this time we start getting the final reports on how things went the previous year for all the Japanese camera companies globally (as opposed to regionally). The first one up is the total camera shipments (compacts and interchangeable lens):
The big news everyone is reporting is that Fujifilm overtook Nikon for third place in overall market share. But note that Fujfilm had more new model introductions and has three strong-selling compact cameras that influence that, while Nikon continues to pull back from compact cameras (wrong decision, Nikon). As I worried about, Nikon taking over RED has caused the usual issue of slowing the entire organization down as it tries to manage the acquisition and get everything and everyone re-aligned.
You can tell that compacts were a big part of that overall market share shifting, as Ricoh suddenly hit single digits (2.1%, up from 0.8%).
But the full bragging right probably happens in the Canon versus Sony contest. After slowly eating into Canon’s overall market share, in 2025 Canon suddenly moved closer to historical levels of dominance while Sony slipped significantly (~4 percentage points).
I’ve been covering these market numbers since about 2005, and while they reveal interesting short-term patterns—for instance, the recent resurgence of compacts—be careful about reading too much into them. All of the Japanese camera companies are masterminds at micromanaging how their economics work. They’ll take stabs at growing through market share increases, they’ll take respites where they try to emphasize price and margin, they’ll dump inventories into specific markets, and they’ll take their time when they expect to make a major changeover in something. Essentially, each one is constantly using the gas pedal and the brake pedal, as necessary, to produce the results they want (or sometimes need) short term.
The one thing I would note, however, is that Nikon clearly missed the opportunity for re-introducing substantive new compact cameras. Ditto to OMDS, who also saw a market share slide.
Looking carefully at the numbers (and year to year), you see more clearly why the rankings changed. In particular, note Ricoh, who went from 70,000 units to 210,000 units a year, implying that the GRIV sold somewhere near 150k units on its own. Fujifilm’s number boost, too, was high, from 740,000 units to 1,160,000 units, and you have to wonder how much of that gain was beginning to truly fulfill X100VI demand, coupled with the introduction of two other new compacts (GFX100RF and more importantly, the inexpensive X half).
I’d judge most serious photographers to be mostly satisfied and bored with their current cameras. The prolific Sony had trouble keeping their unit volume up, despite the update of the mainstream A7. What seems to be being bought most at the moment is “something different that what I currently own.” Even the Nikon ZR fell into that category and has done decently, despite being basically a Z6III with a simplified UI, no viewfinder, and a new raw video format. (I should note that I don’t have access to global sales by individual camera, though I do have access to some regional data from which to make such judgments.)
To some degree unit volume reports like this Nikkei one, can also indicate churn. When companies iterate often, some of that is intended at getting their user base to update. When companies iterate less often, they almost certainly don’t benefit from model churn in their user base. What I’m not seeing in my surveys that I used to see is significant leaking from brand to brand.
But I’m not sure any of the above is as important as my next section of this week’s summary. The overall camera market that is currently dominated by the Japanese is relatively flat in volume (other than compact cameras), and the camera companies are all micromanaging how they profit from something at or near their current level of sales. But that is probably in danger, to whit:
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Commentary
Japanese Lenses Under Attack
TTArtisans this past week shipped their second inexpensive Neo lens, the US$99 autofocus 85mm f/1.8. Like the 50mm f/1.8 before it (and which I have in review testing), TTArtisans has gone the simpler route; this lens doesn’t have a manual focus ring. The approach here seems to be to cut features but make a very usable lens nonetheless. No function buttons, no AF/M switch, no focus ring, etc., just a simple basic lens that can undercut the Japanese makers on price. At US$99, that’s one heck of an undercut.
But it’s not going to end there, folks. The zooms are coming.
With 24 to 85mm prime lenses covered by many Chinese lens makers—in some focal lengths, multiple times—the next step is to grab the two primary zoom purchases: 24-70mm, and 70-200mm. Meike is already stating that they have f/2.8 zooms coming, and I’ve now heard from two other Chinese makers about impending zooms, as well. We’ve even seen brands like Laowa take on the exotics, with their 200mm f/2 lens.
The cat is not only out of the bag now, but it’s running around jumping on all the furniture and constantly scratching it to see what happens. What happens is that Japanese camera industry economics go down the drain, as the 1.5x lens attach rate that is relied upon in Tokyo is now in jeopardy. Actually, most of the mirrorless makers at one point or other told me that they felt that their attach rate would go up significantly (Nikon execs publicly forecast 2x but never got above 1.6x before dropping back to just below 1.5x). My sense from my user surveys is that new mirrorless users (and those that have been switching from DSLRs) are indeed buying more lenses, but a number of those have been sampling of the Chinese offerings.
Long-time readers of mine know about Sampling. It’s a user practice outside of brand loyalty that ultimately undermines a brand.
The irony here is that the Japanese Ministry of Economy, Trade, and Industry (METI) just published a report that essentially says that the Japanese digital camera industry shows signs of recovery after a long-downhill slide against the adoption of smartphones as cameras. First, that report seems “late.” Any recovery (of sorts) really began in 2023 as the supply-chain issues caused by the pandemic started to loosen. However, “recovery” in METI's sense means more like “bottomed out and now more closely mimics overall economic growth.”
The quotes I’ve seen from the report seem to not have statistical verification and are coupled with equivocation, such as “…likely due in part to the…demand from younger generations for use in social media and video sharing.” I’d point out that products such as the DJI Osmo and Insta360 have shown much more take-up with that group than I can measure from the Japanese makers.
Which brings me to this: the Chinese ILC cameras are coming. Specifically, in February 2027 it now appears. It should be interesting to read METI’s next (late) report.
Likewise, it will be interesting to see Nikkei’s 2026 report next year, as they already leave out foreign operations such as Hasselblad and Leica. So when the Chinese start selling a significant number of cameras, what will Nikkei’s Japan-made-only numbers look like? By way of comparison, DJI appears to have sold over 22,000 units just at Amazon US in July (that’s cameras, not drones)! That run rate makes a mockery of Nikkei’s “global camera volume” numbers. If we count DJI’s various Osmo offerings, they would have been in a solid third place for 2025 in terms of unit volume, and growing rapidly.
Note to Japanese executives: you missed another turn.
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A Look Backwards
First But Not First
It’s curious to me how Nikon keeps getting things right, but then messes that up. This has occurred many times in Nikon’s history—for instance Nikon was first to engineer autofocus and vibration reduction but didn’t actually spin usable consumer products with them first—and this problem continues to this day. Eventually, someone else runs with the same ideas and shows how to really do them in a way that resonates with users, and then Nikon follows. Despite having been early to the idea. So this has to be something endemic to the way engineering works at Nikon.
The two somewhat recent examples are the Nikon 1 (mirrorless) and KeyMission (action/pocket).
Nikon 1 introduced a bunch of things we take for granted today: dual gain sensor, phase detect on sensor, and much more, including what Apple today does as Live Photos. Lots of great, new ideas were in the Nikon 1 products, and that doesn’t surprise me, as much of the early design work was done by the same leader and team that created the Nikon D3, a seminal camera in digital photography history. That group was tasked with finding “the next important things” and they most certainly did. If the D1 was the camera that first put together all the things that we associate with DSLR, the Nikon J1 and V1 were the cameras that first put together all the things that we now associate with mirrorless.
Unfortunately, management nerfed the resulting products for fear that they would cut into the DSLR line. Then the quake, tsunami, and flood hit and pretty much stopped all DSLR production, leaving the Nikon 1 the only thing that Nikon could sell. And it did, partly because it had to. Nikon spent big money on advertising (remember Ashton Kutcher as the spokesperson), and that worked.
Sort of worked. One of the primary complaints was that the Nikon 1 didn’t align with much of anything in the DSLR lineup. About the only accessory crossed over to DSLRs was an F-to-CX mount adapter. Flash? Incompatible. Other accessories? Incompatible. GPS? Incompatible. Interface and menus? Different. In essence, you were either a Nikon 1 user or a Nikon DSLR user. You couldn’t easily grow from being a Nikon 1 user to a Nikon DSLR user.
Moreover, the Nikon 1 had the same fundamental flaw that Nikon keeps repeating: customers balked at some features, feature limitations, overly complex things, the lack of DSLR carryover, and most importantly, clumsy UI. I wrote that the D1 was the kick-off of DSLRs earlier, and it had many of those same problems. The Nikon engineers engineered things, but they weren’t actually using them or talking to the customers that would. The result with the D1 was a modal camera that was frustrating to use in real life, yet proved to be the basis of what we really wanted. Fortunately, Nikon quickly fixed the user issues with the subsequent D1h and D1x models.
Nikon 1 cameras had the same problem. Take the V1, for instance. It had three or four things that shouldn’t have made it past early design stage (in addition to the DSLR accessory nerfing). All of them had to do with control use, fidelity, and placement on a small camera. It was far too easy, for instance, to accidentally change whatever Exposure mode you had selected into one of the special modes, meaning you missed moments in time on what was otherwise a very fast camera. It was also easy to accidentally turn off the camera, as the on/off button was adjacent to the shutter release. And yet I could do things at the time with that V1 that I couldn’t with my Sony NEX; I just would find myself swearing at some design elements (of both cameras, actually) from time to time.
There’s no reason why today we shouldn’t have a current and more complete Nikon 1 line. It would rock given the upgrades it would have now, and be the compact camera of choice against the fixed lens Fujifilm, Pentax, and Sony models. But instead of fixing the issues, Nikon just seemed to randomly experiment for awhile and never quite ironed out the usability issues, which, of course, eventually impacted sales. Coupled with the fact that unit volumes of all cameras were dropping dramatically during the Nikon 1’s lifespan, it apparently was easier for management to drop the Nikon 1 rather than address the real issues it had.
Which brings us to the KeyMission. Once again, Nikon correctly saw that there was a market that their existing offerings weren’t serving. GoPro was the one of the first to identify that market in between smartphone and traditional cameras. Ironically, neither GoPro nor Nikon truly understood what they should be doing there. You only have to look around at the DJI and Insta360 extensions, alterations, additions, and accessories to see that there’s much more market there than just a small box that’s water and shockproof.
The KeyMission 360 was actually the D1 to what DJI and Insta360 now deliver as much more completed and competent solutions (Osmo 360 and Insta360 x6, respectively). The KeyMission 170 was for some reason, a GoPro clone without distinction, which seems to indicate that Nikon didn’t really know how to extend this market. The KeyMission 80 crossed over into the creepy wearable territory that today is occupied by Meta and its glasses and nobody seems to be able to get any traction with.
So once again we saw Nikon seeing things (other than what the KeyMission 170 should have been) in advance of the rest of the camera world, but essentially fumbling any early advantage they might have had.
Alongside those two (Nikon 1 and KeyMission) sat the ill-fated DL line: three compact cameras that, even today with the specs and features Nikon announced in 2016, would be, with updates, pretty clear winners now that the compact camera market is expanding again. Ditto the Coolpix A.
This we-see-the-future-but-fail-to-see-the-future aspect of Nikon’s management seems entrenched given that it has existed over multiple generations of executives running the show. It’s the reason why Canon dominates dedicated camera sales—at least if we don’t count DJI and Osmo360—and not Nikon. You even see this in messaging from Nikon management: “generate stable profits” and “secure stable earnings” are the constantly repeated mantras in the business planning documents for Nikon Imaging from top management. The current management plan has a target of a 25% revenue growth over the next four years, but as we’ve all seen with the recent tariffs and price increases, that doesn’t necessarily mean selling more units, let alone more interesting cameras and lenses.
Many times in Nikon’s past we’ve gotten the impression that they simply want to “milk Imaging [cameras] to provide cash for Precision [semiconductor manufacturing equipment].” Note that Omura-san said recently “select[ing] businesses…and growing them significantly.” Missing in that presentation was that Imaging would be grown significantly, despite Imaging “performed steadily” while Precision “fell far below assumptions.” Worse still: apparently the RED acquisition tilted things the wrong direction for management: “Issue: upfront burden of video-related investment.” It’s also clear that Nikon thinks that the RED acquisition will ultimately provide much of what revenue growth Imaging does generate.
As I’ve described now for almost thirty years on my Web site, the missing component for Nikon is simple: lack of customer understanding and embrace. Even Omura-san admits this: “our poor results stemmed from insufficient attention to what customers need and want to realize.” The problem is, I believe that statement to be more about business-to-business customers, not the 40-50% of the business (Imaging) that is consumer-facing. I say that because I’ve seen near zero—despite repeated discussions with Nikon and Nikon executives—to indicate that Nikon is hearing us consumers.
I’ll give a recent example. I got an email from a reader who had a recent encounter with the Japanese service technician at Melville. Their conversation centered around the lack of control configuration for subject detection, to which the technician was surprised and intently took notes he was going to relay to Japan. Great, but I’ve had (as have others) that same conversation with multiple Nikon employees and executives several times now, and we still haven’t seen the issue addressed. So, yes, Nikon went from not listening to listening. But ultimately, it’s actions based upon that listening that counts most with customers.
Now this may all seem negative, that I might be predicting the demise of Nikon Imaging. Nope. It’s basically the same thing I’ve been writing for 30 years now: Nikon’s lack of direct connection with consumers blocks them into being a smaller player than they could be. Sony has Kando, Fujifilm has Fujikina, Canon has…well, a lot of marketing. What does Nikon have that’s interacting directly with camera customers? That’s my point in writing these articles. Long-term Nikon customers aren’t exactly happy with the level of interaction we get from the company, NPS notwithstanding. As it is, I tend to have better discussions with Fujifilm executives at trade shows than I do with Nikon ones, and I suspect much of the photographic press would tend to agree with me on this. That needs to be fixed. Because the ultimate way to grow a business in a healthy way is to embrace your best customers and make them happier.
Overall, I expect Nikon to continue to do what they’ve done: engineers figure out the next innovation and then management lets other companies get the biggest benefit from it. For sure, the Z System line will only get stronger with the next generation, but the real need is to leapfrog in ways that restores the excitement Nikon Imaging has at times generated at the same time as embracing the consumer more closely.
I note that the two ways Nikon fully described in their current management plan as to how they’d get new Imaging customers were “apps and 1-to-1 marketing to stimulate lens add-ons and step-ups” to improve profitability, as well as “leverage RED’s cinema industry network…to rebuild Nikon’s brand as a cinema camera maker.” I’ll make a bet prediction: when we revisit those statements at the end of the current plan in 2030, the first of those will have failed, and the second will have been only modestly successful.
The thing that puzzles me is this: what I’m suggesting is not rocket science. It’s a well proven and oft-followed strategy. Indeed, some of Nikon’s key competitors clearly do better at this.
Personally, I don’t care if Nikon is #3 or #4 (or #1 or #2) in cameras. Somehow, despite all the above, I have cameras today that far exceed the capabilities of what I used to be able to do, and with only a few complaints, are everything I need. Nikon’s never had difficulty at that: even when they miss a turn, don’t embrace an innovation, or have external issues that hold them back, they still manage to eventually put out quality gear that works. I don’t see any change to that happening in the next few years, as the engineering teams have shown their ability to innovate/iterate for decades now.
It’s the crossover from engineering to marketing (and back) that Nikon struggles with from time to time, and it’s never been fixed. Here’s a thought: make that (embrace consumers) an addition to the medium term business plan. After all, it resonates with the other wording that’s being used in Nikon’s presentations. It just needs a commitment to actually do it.